Daycare providers: Why it's so expensive

The Anchorage Assembly is looking at ways to reduce the cost of childcare city-wide after a proposed ordinance to subsidize care for assembly members drew sharp criticism last month.

High costs aren't just an Anchorage problem but rather a statewide problem. A study by the Economic Policy Institute found that the average cost of care for an infant in Alaska is $10,957 a year-- nearly $1,000 a month.

"I mean, you look at the average spot is $1,000 a month. That's, you know, throughout the state, and that's really expensive," said Christina Eubanks, director of Hillcrest Children's Center in Government Hill.

Thousands of Anchorage families rely on centers like hers to care for their small children during the day.

"We have children who are in care 40 to 60 hours a week, and so when you're looking then at those formative years, everything that you do and don't do is impacting them," Eubanks said.

But even Eubanks admits that providing quality care is costly and for many is simply not affordable.

The Economic Policy Institute found that childcare is one of the biggest expenses families in Alaska face. For most, daycare costs more than college tuition. Specifically, infant care, which is 78 percent more expensive a year than public college.

"I mean, it's the higher cost of living, everything costs more, so it just costs more to provide. It's not that we're getting paid more," Eubanks said.

In fact, Eubanks says most of her employees are making minimum wage and don't have health insurance or retirement plans.

While the Municipality of Anchorage is looking for ways to help, Eubanks says much of the solution lies with the state. While the cost of living has increased over the years, allowance for the nearly 2,000 Anchorage children on state assistance to pay for care has only gone up once in the last 10 years.

"That's the thing is care is subsidized by the wages that you provide the staff, and so we're subsidizing your care because we're not getting paid a living wage," Eubanks said.

It's a strain not just on daycare centers but also on in-home child care providers.

"Child Care Assistance, what they provide right now is-- I'm not going to say never enough for what a provider is needing-- but it hasn't kept up with what a provider needs to make," said Tia Hollowood, a retired teacher who now runs a home daycare as a way to supplement her income.

Since it's a side job, Hollowood says she can afford to charge a little less. Even so, she says her rates still run about $700 a month.

"You have to have the money to run a business and to be able to provide the things that the kids need, in the way that they need it. And if I need somebody extra for a trip or something, I need to be able to pay for help to be able to go and do that," Hollowood explained.

The high-cost dilemma is a bit of a catch 22 for providers and parents who need daycare in order to work but can't work enough to afford it.

Which leaves their kids spending more hours with daycare providers.

Right now, the state is considering changes to tighten up current regulations, in compliance with federal mandates, which providers say also increases their costs.